Banyan Tree eyes projects in Malaysian secondary cities

Banyan Tree eyes projects in Malaysian secondary cities

MALAYSIA'S George Town, Ipoh and Melaka are secondary cities that Banyan Tree Hotels & Resorts is keen to put down roots should the right opportunity come along. Borneo's Sabah with its renowned rainforests is another place that appeals, said Banyan Tree Holdings executive chairman Ho Kwon Ping.

"We are always looking," Mr Ho said at a hotel management agreement signing ceremony between Banyan Tree Hotels & Resorts and property developer Harmoni Perkasa for the five-star Royale Pavilion Hotel on Wednesday. The Singapore company is also managing the 150-room Banyan Tree Signatures Pavilion Kuala Lumpur. Both hotels are located next to the Pavilion KL mall in the city centre and will offer nearly 500 rooms by the second quarter of 2017.

Mr Ho said the partnership with Harmoni Perkasa provided Banyan Tree the opportunity to get into Kuala Lumpur given its "super prime" location, which in the Singapore context would be on Orchard Road. Tycoon Desmond Lim and the Qatar Investment Authority are the ultimate owners of Harmoni Perkasa. They also control the popular Pavilion KL mall.

Mr Ho said Banyan Tree Signatures Pavilion would be more of a boutique or urban resort with larger rooms, targeting free independent travellers and top-end corporates, while Royale would be more mainstream five-star and "attuned to the desires of avid shoppers and the MICE market".

The KL developer has been physically integrating its prime assets in the area - there is a bridge linking the mall and Signatures which also has residences for instance - making it more convenient for its guests and residents, many foreign. Even so, competition is expected to be intense, property consultants say, as an unprecedented 12 luxury hotels with an some 3,080 rooms are scheduled to enter the KL market by 2021.

St Regis and Ritz Carlton suites are due to come onstream this year, and W and RuMa next year, according to a report by Horwath HTL. Four Seasons, Kempinski, Fairmont KLCC and Jumeirah are some of the others in the mix. But plans to build the Harrods Hotel which Mr Lim and his Qatari partner had announced in 2012 have been scrapped.

The increase in hotel rooms will need a significant increase in tourist arrivals, particularly after last year's marked drop in visitors resulted in a 10-15 per cent drop in occupancy rates in the city to around the 60-65 per cent mark. Penang hotels are reportedly doing better as the state's tourism sector was less affected, while Ipoh is also getting more visitors as more investments pour into the hospitality sector.

Banyan Tree is already in Penang under the Angsana brand and depending on the opportunities, could go into partnership in other locations - or ostensibly on its own - using its other brands, Cassia and Dhawa.

Although nothing materialised from previous recces in Sabah and Langkawi, Mr Ho remains on the look-out. Having purchased a residence at Signatures, he intends to spend more time in KL which he described in his speech as "more hip and happening than Singapore" to the delight of Federal Territories Minister Tengku Adnan, who was the guest of honour at the signing ceremony.

This article was first published on March 31, 2016.
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